The new federal Education Minister, Christopher Pyne, has accused Labor governments of shrinking the international student market.

In a recent interview with The Australian Financial Review, Mr Pyne said that since Labor started changing the rules for international students in 2008, "they've managed to shrink the industry by about a quarter, which is a pretty dramatic failure given that the economy's been growing in that period". He said when Labor took office in December 2007, education was Australia's second highest source of foreign income, or fourth highest if mining was broken down into iron ore, coal and gold.

ABC Fact Check asked Mr Pyne for the basis for his comment. His spokesperson referred to a February 2013 report by economic consultants Deloitte Access Economics commissioned by the Australian Council for Private Education and Training, an industry body representing private education providers. The report said income from foreign students fell from $18.1 billion in the year to June 2010 to $14.7 billion in the year to June 2012. This is a drop of just under 19 per cent.

The claim: Christopher Pyne says since 2008 Labor has shrunk the international student industry by about a quarter.

The verdict: Mr Pyne overstates how far the international student industry has shrunk and his claim that Labor was responsible for the drop is not the full story.

Income from foreign students

Recent Australian Bureau of Statistics data shows income from international students was $12.2 billion in 2007. It peaked in 2009 at just under $17 billion and fell to $14.5 billion in 2012. These numbers, for calendar years, are more recent than the financial year numbers used in the Deloitte report referred to by Mr Pyne's office.

Official Department of Foreign Affairs and Trade numbers for 2012-13 will be released this month. A spokesperson from the department said that preliminary data shows education-related travel is still Australia's fourth largest export, as it was in 2012. Only iron, coal and gold were larger export earners last year.

The current figures show that income from education exports has shrunk by about 15 per cent since the 2009 peak, not 25 per cent as Mr Pyne suggests.

The number of foreign students

The top five source countries for students studying in Australia are China (29.7 per cent), India (9.2 per cent), Korea (5.3 per cent), Vietnam (4.8 per cent) and Malaysia (4.7 per cent). Most come to study at English language schools, Vocational Education Training (VET), or universities.

The Federal Department of Education's database shows that the total number of international students enrolled was 630,694 in 2009 and declined to 515,853 in 2012. This seems a high number of students compared to the above Immigration Department data, but the Education Department counts actual course enrolments. A student who is attending two different courses (for example, a language school and a bachelor degree) will have both enrolments counted. The department's numbers show a similar decline, of 18.2 per cent since the 2009 peak.

Both of these developments led to a series of reforms which reduced the number of foreign students in Australia.

The changes were:

Tightening of skills requirements - In 2010 occupations like hairdressing and cooking were removed from the Skilled Occupation List. The number of offshore Indians granted student visas for VET fell from 31,389 in 2008-09 to 693 in 2010-11.

Temporary stay requirement - In 2011 students were required to prove that they were temporary residents and had no intention to stay permanently. The impact of the Genuine Temporary Entrant (GTE) requirement resulted in an acceptance rate for offshore Indian nationals falling from 90.8 per cent in 2007-08 to only 49.6 per cent in 2010-11.

Crackdown on non-genuine students - In 2012 the government introduced a new visa that allows students who study at bachelor degree level to stay for up to four years after they graduate. This Temporary Graduate Visa only allows students who got their first student visa after November 5, 2011 to apply. This was done to weed out the non-genuine students. The demand for VET went down as a result.

The rule changes were not the only reason for the decline in foreign student numbers.

These factors were not mentioned by Mr Pyne and many were beyond the control of the Labor government or were necessary to protect the integrity of the visas being issued.

The verdict

Mr Pyne overstates how far the international student industry has shrunk. Income from the industry has fallen by 15 per cent since the 2009 peak. The number of student visas has declined by 19 per cent. Neither measure is as high as Mr Pyne's 25 per cent.

His claim that Labor was responsible for the drop is not the full story. It was due to many factors - not just Labor policy. His comments in the The Australian Financial Review are exaggerated.